Two points down, 2.1 precisely. It is the drop in the unemployment rate, as measured by INSEE within the meaning of the International Labor Office (ILO), during Emmanuel Macron’s first five-year term. Two points less, or even a little more, is the way to go to achieve, as the Head of State has set, the objective of full employment by 2027.
While INSEE announced on Friday that the unemployment rate was almost stable in the second quarter at 7.4% of the working population (but still lower by 0.8 points compared to the end of 2019), the executive knows what compelled to keep its promise. Eradicating mass unemployment means going down to around 5%. That is to say, to return to the situation of the end of the 1970s, when the second oil shock gave the coup de grace to the Trente Glorieuses.
1 million additional jobs by 2027
In a less abstract way, in the current state of the hypotheses for the evolution of the active population (it was 30.1 million on average in 2021), it takes 600,000 fewer unemployed people to scratch 2 points. Either go from 2.26 million to 1.66 million, still according to the ILO definition of unemployed. To reach the Holy Grail of 5%, it takes about 750,000 less. Taking into account what INSEE calls the “pull effect” on the working population (when the economy is good, more people want to work), this means up to 1 million additional jobs by to 2027, again according to the national statistical institute.
Assuming that the Ukrainian crisis is resolved and that no other breaks out over the five-year term, can the French economy create as many? The question divides economists. According to the theory, for the salaried or non-salaried workforce to grow, growth must largely compensate for productivity gains.
Employment versus productivity
But is the theory still valid? Quarter after quarter, employment continues to progress well despite the slowdown in growth. At the end of June, in its latest economic report to date, INSEE expected 200,000 more salaried jobs this year. With more than 100,000 jobs in the private sector in the second quarter, we are almost there already in six months!
Conclusion of certain economists: it is to the detriment of productivity, which will end up rebounding, slowing down, or even pushing back, employment. Among them, the OFCE estimates that there are currently 500,000 excess positions. Emmanuel Macron can therefore forget his objective, they believe.
Two schools clash
There is no consensus on the thesis, if only because productivity has been falling in Europe for a long time. Technological progress would no longer be sufficient to produce more with a constant workforce. Under these conditions, with the supply policy undertaken since 2014 and the accentuated tertiarization of the economy, we are creating many more jobs today than yesterday at a given growth rate. The Head of State is therefore right to cling to his objective, we believe in this camp.
The future will decide between the two schools. Two things seem certain, however. First, the second step in the fall in the unemployment rate will be more difficult to pass than the first, although of the same magnitude. In fact, the push of 2 additional points requires re-employing the people who are the furthest away from it. For them, the need for support – without omitting the prejudices of which they are victims, seniors or inhabitants of the priority districts of the city in particular – is greater.
Leaps and bounds
It is therefore necessary, secondly, that public employment policies in the broad sense take a giant step forward in terms of efficiency. The example of learning shows that no cause is lost. Even if it can be improved, the 2018 reform is bearing fruit: 730,000 contracts signed in 2022, the government wants 1 million. The list of sites to be opened is known: reform of vocational high schools, integration of RSA beneficiaries, training of the unemployed or even unemployment insurance rules that are more incentive to return to work.
The quest for greater efficiency will also depend on the “France travail” project around Pôle emploi. Elisabeth Borne, who spent two years at the Ministry of Labour, set the tone. “We can no longer continue to have, on the one hand, the State which accompanies job seekers, on the other, the regions which take care of their training and the departments in charge of the integration of beneficiaries of the RSA”, detailed the Prime Minister during her general policy statement to the National Assembly. First elements at the start of the school year normally with the launch of a configuration mission.